BELLRING BRANDS, INC.BRBR
BELLRING BRANDS, INC. Income Taxes Disclosure
INCOME TAXES
The expense (benefit) for income taxes consisted of the following:
| Year Ended September 30, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| Current: | |||||||||||||||||
| Federal | $ | 74.3 | $ | 73.1 | $ | 49.1 | |||||||||||
| State | 19.2 | 17.8 | 10.9 | ||||||||||||||
| Foreign | (0.3) | 0.7 | 0.9 | ||||||||||||||
| 93.2 | 91.6 | 60.9 | |||||||||||||||
| Deferred: | |||||||||||||||||
| Federal | (16.7) | (7.1) | (4.9) | ||||||||||||||
| State | (3.7) | (1.6) | (1.1) | ||||||||||||||
| (20.4) | (8.7) | (6.0) | |||||||||||||||
| Income tax expense | $ | 72.8 | $ | 82.9 | $ | 54.9 | |||||||||||
The effective income tax rate for fiscal 2025, 2024 and 2023 was 25.2%, 25.2% and 24.9%, respectively.
The following table presents the reconciliation of income tax expense with amounts computed at the federal statutory tax rate.
| Year Ended September 30, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| Computed tax at federal statutory rate (21%) | $ | 60.7 | $ | 69.2 | $ | 46.3 | |||||||||||
| State income taxes, net of effect on federal tax | 12.6 | 13.5 | 8.4 | ||||||||||||||
| Non-deductible compensation | 5.6 | 3.2 | 1.9 | ||||||||||||||
| Other, net (none in excess of 5% of computed tax) | (6.1) | (3.0) | (1.7) | ||||||||||||||
| Income tax expense | $ | 72.8 | $ | 82.9 | $ | 54.9 | |||||||||||
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Deferred tax non-current assets (liabilities) were as follows:
| September 30, 2025 | September 30, 2024 | ||||||||||||||||||||||||||||||||||
| Assets | Liabilities | Net | Assets | Liabilities | Net | ||||||||||||||||||||||||||||||
| Accrued liabilities | $ | 26.4 | $ | — | $ | 26.4 | 6.7 | — | 6.7 | ||||||||||||||||||||||||||
| Accrued vacation, incentive and severance | 4.1 | — | 4.1 | 5.0 | — | 5.0 | |||||||||||||||||||||||||||||
Capitalized research and development | 8.6 | — | 8.6 | 4.7 | — | 4.7 | |||||||||||||||||||||||||||||
| Inventory | 4.5 | — | 4.5 | 4.2 | — | 4.2 | |||||||||||||||||||||||||||||
| Stock-based compensation awards | 2.3 | — | 2.3 | 3.0 | — | 3.0 | |||||||||||||||||||||||||||||
| Lease liabilities | 6.0 | — | 6.0 | 1.0 | — | 1.0 | |||||||||||||||||||||||||||||
| Intangible assets | — | (13.1) | (13.1) | — | (10.9) | (10.9) | |||||||||||||||||||||||||||||
| ROU assets | — | (6.0) | (6.0) | — | (1.0) | (1.0) | |||||||||||||||||||||||||||||
| Property | — | (0.4) | (0.4) | — | (0.2) | (0.2) | |||||||||||||||||||||||||||||
| Other items | — | (0.4) | (0.4) | — | — | — | |||||||||||||||||||||||||||||
Total deferred income taxes | $ | 51.9 | $ | (19.9) | $ | 32.0 | $ | 24.6 | $ | (12.1) | $ | 12.5 | |||||||||||||||||||||||
No provision has been made for income taxes on undistributed earnings of consolidated foreign subsidiaries of $3.0 and $4.2 at September 30, 2025 and 2024, respectively, as it is the Company’s intention to indefinitely reinvest undistributed earnings of its foreign subsidiaries. Any additional income taxes and applicable foreign withholding taxes that would be payable on the remittance of such undistributed earnings would be immaterial.
For fiscal 2025, 2024 and 2023, foreign (loss) income before income taxes was $(1.5), $2.0 and $2.0, respectively.
Unrecognized Tax Benefits
The Company recognizes the tax benefit from uncertain tax positions only if it is “more likely than not” that the tax position will be sustained on examination by the taxing authorities. The tax benefits recognized from such positions are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. To the extent the Company’s assessment of such tax positions changes, the change in estimate will be recorded in the period in which the determination is made.
At September 30, 2025 and 2024, the Company had net unrecognized tax benefits of $1.3 and $1.4, respectively. There was no material unrecognized tax benefits activity during the years ended September 30, 2025, 2024 or 2023. The amount of the net unrecognized tax benefits that, if recognized, would directly affect the effective tax rate was $1.3 at September 30, 2025. No material changes to unrecognized tax benefits at September 30, 2025 are expected to be recognized within the next twelve months.
The Company computes tax-related interest and penalties as the difference between the tax position recognized for financial reporting purposes and the amount previously taken on the Company’s tax returns and classifies these amounts as components of income tax (benefit) expense. During each of the years ended September 30, 2025, 2024 and 2023, expenses recorded related to interest and penalties were immaterial, and the Company had immaterial interest and penalty accruals at both September 30, 2025 and 2024.
U.S. federal, U.S. state and foreign jurisdiction income tax returns for the tax years ended September 30, 2022 through September 30, 2024 are generally open and subject to examination by the tax authorities in each respective jurisdiction.
Tax Legislation
On July 4, 2025, the H.R.1 tax law was enacted in the U.S. (the “H.R.1 Tax Act”). The H.R.1 Tax Act includes provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act of 2017, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions. The H.R.1 Tax Act has multiple effective dates, beginning in calendar year 2025 and extending through calendar year 2027. The H.R.1 Tax Act did not have a material impact on the Company’s effective income tax rate, results of operations, financial condition or cash flows during the year ended September 30, 2025.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Nov 18, 2025 | Showing above |
| 2024 | Nov 19, 2024 | |
| 2023 | Nov 21, 2023 | |
| 2022 | Nov 17, 2022 | |
| 2021 | Nov 19, 2021 | |
About Income Taxes Disclosures
The income tax disclosure reveals how much a company actually pays in taxes versus what the statutory rate would predict. Analysts focus on the effective tax rate (ETR) reconciliation, which breaks down every item driving the gap between the 21% federal rate and the company's reported ETR — including R&D credits, foreign rate differentials, and state taxes. Deferred tax assets (DTAs) and their valuation allowances signal management's confidence in future profitability: a rising allowance suggests the company doubts it can use accumulated tax benefits. Uncertain tax benefit (UTB) reserves quantify exposure to IRS challenges on aggressive positions.
Key signals to watch: sudden ETR drops without clear operational reasons, large increases in valuation allowances, growing UTB balances, and significant unremitted foreign earnings. Post-TCJA, pay attention to GILTI and BEAT provisions that affect multinational tax structures. Compare the cash taxes paid (from the cash flow statement) against the income tax provision to gauge earnings quality.